New CAFE targets

Jan. 1, 2020
The federal government's proposed unified greenhouse gas (GHG) and fuel efficiency standards announced in September will have more impact on OEM manufacturers than aftermarket retailers initially.

The federal government’s proposed unified greenhouse gas (GHG) and fuel efficiency standards announced in September will have more impact on OEM manufacturers than aftermarket retailers initially. But don’t discount long-term impacts the new 2012-2016 standards will have on the aftermarket.

The EPA and NHTSA came up with a uniform GHG/Corporate Average Fuel Efficiency (CAFE) standard, which will allow carmakers to produce a single model they can sell across the country, as opposed to having to produce a second model to comply with California’s tough GHG standard. In exchange for the uniform GHG/CAFE standard, the automakers agreed to comply with a 35 mile-per-gallon CAFE standard by 2016 instead of 2020, the date set by the 2007 Energy Independence and Security Act.

However, each manufacturer will be able to earn “credits” allowing for a lower CAFE number — for air conditioning improvements, which NHTSA currently does not include when testing for fuel efficiency. So NHTSA estimates the 2016 CAFE average could be 34.1 mpg if all companies use their maximum credits, which are also available for alternative fuel vehicles. The 2016 target for GHG emissions across all passenger car, light vehicle and light truck fleets is 250 grams per mile of CO2 equivalent emission. The actual numbers that will be required will depend on the mix of vehicles and their volumes in 2016.

In setting those targets, the agencies looked at the costs and benefits of applying 35 auto technologies to various “footprints,” determined by multiplying the vehicle’s wheelbase by the vehicle’s average track width. One of the technologies the agencies cranked into their equations was low-rolling resistance tires. Another example of an OEM-to-aftermarket product line innovation resulting from the new GHG/CAFE standards will be low-friction lubricants.

Those aftermarket implications are some of the more obvious ramifications of the proposed automobile tailpipe and fuel efficiency standards, which will be finalized sometime in the near term. There are some not-so-obvious implications as well. The footprint-based analysis has the potential to result in manufacturers phasing out the heavier cars in each footprint, which will discriminate against sports cars. So while the market for low-rolling resistance tires may swell, the market for performance tires, and other sports car aftermarket products, may contract.

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